Bloomberg: Apple’s Jobs should give back the $85 million

“Apple Computer Inc.’s Steve Jobs should give it up,” Graef Crystal writes for Bloomberg. “What am I talking about?”

Crystal writes, “Some $85 million or so that the chief executive officer collected because of a sleight-of-hand the maker of the iPod music player and Macintosh computers engaged in when it awarded Jobs some mammoth stock option grants. That’s money that should go back to the shareholders.”

“Apple’s well-oiled public relations machine has said that because of ‘irregularities’ in the grants, the options were canceled ‘and resulted in no financial gain to the CEO,” Crystal writes.

Crystal writes, “Nothing could be further from the truth.”

Full article here.

Related articles:
Apple Computer Directors may have had conflicts of interest in options investigation – October 11, 2006
Apple’s options disclosures leave plenty of unanswered questions – October 09, 2006
Apple shareholders await earnings restatements; Steve Jobs still not in the clear – October 06, 2006
Former CFO Anderson helped turn Apple Computer around – October 05, 2006
Wall Street unshaken by results of Apple stock options investigation – October 05, 2006
Is Apple rotten at the core? – October 05, 2006
Analyst: Anderson, Heinen may be former Apple executives responsible for irregular options grants – October 05, 2006
Analyst: Apple restatement due to options irregularities not expected to be significant – October 04, 2006
Apple’s special committee reports findings of stock option investigation – October 04, 2006
Google CEO declines Apple automatic stock option grant; plans to buy 10,000 AAPL shares instead – September 01, 2006
Google CEO Dr. Eric Schmidt joins Apple’s Board of Directors – August 29, 2006
Shareholders allege Apple execs reaped ‘millions’ in unlawful profits – August 23, 2006
How options-backdating irregularities can affect your Apple Computer stock – August 23, 2006
Apple’s options imbroglio: Mac-maker granted options at or near key events in company’s history – August 18, 2006
Apple added to Nasdaq’s list of ‘delinquent companies’ – August 18, 2006
Apple unlikely to be delisted by NASDAQ – August 16, 2006
Apple CEO Steve Jobs drawn into stock options scandal – August 15, 2006
Apple announces update regarding stock option grants – August 11, 2006
As expected, Apple delays quarterly results due to stock-options grants review – August 11, 2006
Some stock options grant decisions were made by Apple board, and potentially, CEO Steve Jobs – August 10, 2006
Disney: no material impact from Pixar options – August 09, 2006
Pixar options draw scrutiny – August 08, 2006
Apple stock options scandal? What scandal? – August 07, 2006
Class action lawsuit over stock options filed against Apple Computer, Inc. – August 04, 2006
Wall Street forgiving of Apple’s stock option irregularities; CEO Jobs unlikely to be terminated – August 04, 2006
Apple’s stock option irregularities escalate into a scandal as world awaits Steve Jobs’ WWDC keynote – August 04, 2006
Apple warns of profit restatement dating back to 2002 – August 04, 2006
Apple loses 3.5% to $67.15 in premarket trading – August 04, 2006
Apple announces update regarding stock option grants – August 03, 2006
Shareholder’s options suit against Apple alleges ‘striking pattern that could not have been chance’ – July 11, 2006
Apple announces update regarding stock option grants – July 05, 2006
UBS: stock options probe unlikely to hurt Apple – June 30, 2006
Apple joins growing list of companies entangled in stock option ‘irregularities’ – June 29, 2006
Apple to investigate stock option grant ‘irregularities’ made between 1997 and 2001 – June 29, 2006
Fred D. Anderson joins Apple Board – June 08, 2004
Apple CFO Anderson to retire on June 1, 2004; will join Apple’s Board of Directors – February 05, 2004


  1. As a stockholder I am glad to have Steve’s income tied to the price of the stock. It is unfortunate that this all happened as it is a distraction from the great work this company has done over the last few years, largely due to the efforts of Steve Jobs. From what I read here and elsewhere I don’t believe Steve did anything wrong. I think Crystal’s article is really intended to give her an “angle” on this story that no one has taken so far, giving her great publicity. Its probably working. So, Kudo’s to Crystal for writing a creative and novel story – but I think substance of the article is vacuous.

  2. Supplied,

    I agree with the vast majority of what you say.

    The question I’ve posed a few times (but haven’t seen any answer is): If options can be backdated to give extra profit through hindsight, why can’t the rest of us by stock at a point within the same window of time to best benefit us?…

    [And please hold comments on the obvious legalality of it, this is an ethical question. To further the ethical arguement, it’s not like BoDs don’t have an insider’s perspective on where the stock price is headed, so they have a benefit that retail purchasers of stock certainly do not. The grant receivers of the CxO variety are already operating at an advantage the rest of us will never have, let alone the fliexibility in pricing the stock to the lowest price in a window of time.]

  3. “If options can be backdated to give extra profit through hindsight, why can’t the rest of us by stock at a point within the same window of time to best benefit us?…”

    The answer is that they can be “backdated to give extra profit”, but the equivalent is that a different strike price can be chosen which gives the option more “intrinsic value” which is the difference between the strike price (price you pay to exercise) and what the stock’s worth today.

    But if “backdating” is chosen, that extra value being given to the person should be recorded in the company’s books, not hidden by the backdating and by pretending that the options given were only worth what they would have been if granted on the backdated date (where the possibility of future gains was still uncertain).

    So for the company doing things properly, there’s no free lunch, either way the expense will be recorded.

    Therefore there’s really no legitimate reason to ever issue backdated options.

    So most instance where this happens is because a fraud is being perpetrated on the shareholders by backdating the options to avoid recognising that expense.

    On why can’t you buy at the best price, The answer is because you would then have to find somebody who’d be prepared to sell it to you today for less than the market price. Not unethical, just highly unlikely.

    Finally in the US it’s illegal to trade on non public important information (insider trading). However while the insiders theoretically can’t act on non public information, that’s a hard thing to police.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.